The Missing Part of The Washingtonian Signing Bonus Story

I’ve seen several links to the Washingtonian piece on Supreme Court signing bonuses. The interesting claim in the piece is that hiring Supreme Court clerks is a “gamble,” because it’s possible they’ll leave after a very short period of time but keep all the money. (“So how can a law firm ensure it’s betting on a clerk who will stick around? It can’t.”)

The odd thing is that the piece simply doesn’t mention that quite a few law firms have actually thought about this and have mechanisms in place to deal with it. Some firms have contractual requirements that clerks pay back a portion of the bonus if they leave before a certain time period (which can have serious tax penalties as well). Some firms pay the bonus in installments over the course of several years, so those who leave early don’t collect it all.

I know that plenty of firms do this, but I don’t know how these provisions have worked in practice, how they interact with social norms of loyalty to one’s firm, whether they’ve turned out to be a bad idea, and so on. Those might have been interesting questions for the author to tackle, but unfortunately the piece makes it sound as if there’s no mechanism for shifting some of the risk of uncertainty from the firm to the clerk. On the contrary there is, and some firms do.